Brexit draws UK companies to Iran despite shadow of sanctions

With the prospect of Brexit limiting their ability to operated within the EU, UK firms are cautiously turning to the attention the opportunities potentially on offer from Iran’s $600bn anticipated boom in trade and infrastructure investment over the next ten years. With the Islamic Republic about to embarking on an ambitious investment drive after years of international isolation, the authorities in Tehran are expected to be looking overseas for the finance it requires for a number of key projects, including the expansion of its 10,223km long state-owned rail network; the construction of 7 new international airports; the upgrade of 54 existing ones; and the acquisition of a new fleet of aircraft. The state carrier Iran Air has already placed orders with Airbus for 114 new aircraft and it is estimated that another 600 new airplanes will be needed over the next decade. Iran also hopes to secure large investments into its unexplored and under-developed natural gas sector. “Is there an opportunity here for UK business? Of course there is,” said Amanda Clack, head of Infrastructure and consultancy EY told The Telegraph this week. “Deliverability is key and contracts could be won by British companies on the basis of professionalism. These skills are underpinned by high standards and regulation which means the companies are more likely to offer a robust approach to the work.” However, according to the The British Iranian Chamber of Commerce (BICC), the main obstacle towards a significant increase in British Iranian trade lies in the absence of banking facilities caused by the fear among European banks of American primary sanctions against Iran which were retained even after the Iran nuclear deal in late 2015. “Until the American election there were indications that some UK banks were willing to handle direct transactions with Iran under certain conditions. Since then attitudes of the banks seem to have become more cautious and restrictive,” a spokesman said.